Auto insurance provides people with a form of financial protection in
case something unexpected and costly happens to their vehicle. Liability
insurance is a legal requirement and some states require drivers to have
both property damage liability and uninsured or underinsured motorist
coverage. However, based on your location and personal driving needs,
basic auto insurance coverage might not be enough. We previously covered
everything you need to know about auto insurance so let’s talk about
what will be covered by different types of insurance.
Different Types of Car Insurance
There are several types of auto insurance: personal
injury protection, collision coverage, comprehensive coverage, medical
payments coverage, uninsured and underinsured motorist coverage, and
auto liability coverage. Note that the required coverages may differ
depending on where you live but carrying auto insurance is always
important. It’s important to understand what type of car insurance
is required in your state and what you need from your auto insurance
My Vehicle Was Damaged in a Natural Disaster
Natural disasters like hurricanes, storms, earthquakes, fires, and
floods can have devastating effects on our health and property. However,
it is often one of the last things that people consider when building an
auto insurance policy. Your car is one of the most valuable assets that you own and having it
destroyed or damaged due to a natural disaster is a huge loss.
It’s therefore vital that you purchase a car insurance policy that
covers you sufficiently in these extreme circumstances.
In the event of a natural disaster, one of the last things that come to
mind is your car, unless you need to speed off somewhere fast. But like
the rest of your personal property, your car can be damaged or destroyed
in a natural disaster. By being proactive and getting additional car
insurance coverage that will cover you in the event of a natural
disaster, you can save yourself from paying the costly price later.
My Car Was Totaled and I Still Owe Money
Having your car totaled is inconvenient, but having it totaled when you
still owe money on it can be financially devastating. With
40% of Americans having car loans, this is not an unlikely scenario. Recently, more and more people have
needed to extend the duration of their car loan; the average new car
loan has increased to nearly six years. Another fact that we all know is
how quickly a car depreciates, which is the reason why many people owe
more on their car loans than what the car is actually worth.
If your car is totaled and you still owe more than the total value,
your car insurance will only pay the
actual cash value (ACV) of your car. This is the fair
market value of the car at the time that it was damaged. Auto insurance
companies will not pay for more than the value of your car when they
consider your vehicle totaled, and your collision deductible will be
taken out from the actual cash value. For example, if you still owe
$15,000 on a vehicle that is worth $10,000, and you have a $2,000
deductible, then your car insurance company will pay out $8,000 for your
totaled car. Auto insurance companies might write you a check, but the
standard process is for it to go directly to your lender.
As you can see in the scenario above, you still have a lot of money to
pay back. Any amount that is still owed on the car after your car
insurance provider writes the check is your responsibility. You will
find gap insurance extremely helpful especially if you have to pay more
than the value of your car. Gap insurance will pay the
difference between what’s still owed and the actual cash value of
your car. If you’re lucky, your gap insurance policy will cover
enough to take care of your collision deductible as well.
Why You Should Buy Comprehensive Coverage
Comprehensive auto insurance coverage provides protection against damage
and theft caused by an incident other than a collision. This includes everything from falling trees to rocks, hail,
vandalism, flood, fire, and other hazards. Comprehensive auto insurance
is important because of how unpredictable and costly life can be. These
“Acts of God,” as insurance companies call them, can happen
to anyone and at any time. After all, it’s not very often that
someone with a car lives in the middle of nowhere where there’s no
possible chance that a natural disaster will strike. Comprehensive
coverage will lessen the fear of your car getting damaged without you
having the cash on-hand to pay for repairs or replacements. You will
have monthly dues, but you will also have the coverage needed to make
sure that you have a perfectly working car in years to come.
If you want to make sure that you’re covered in the event that
your vehicle is stolen, comprehensive coverage is important to have.
This covers damages to the stolen vehicle, including declared
accessories, spare parts, and total loss of the car. If your vehicle is
stolen, you can claim up to the fair market value of the car in case the
car cannot be recovered. The value of your vehicle minus the
depreciation value will determine how much you receive from your
provider. Remember that this only covers the cost to repair or replace
your vehicle and that personal items inside of the car are not covered.
As long as you follow the right procedure, comprehensive car insurance
will cover the cost in case your car gets vandalized. If this happens to
you, make sure to report the vandalism to the local authorities so your
insurance company is able to obtain the police report for your claim. It
is also important to make note of all the damage done to your car and
take photos that will serve as proof. Once you have reported the
incident to the police and taken photos of the damage, you should
contact your auto insurance company in order to file a claim. You will
need to send them the list of damages you collected and include the
photos that you took and a list of any items that were stolen.
If your vehicle is damaged as a result of a falling object, you may be
covered under your comprehensive coverage. Loss due to a falling object
is covered by your comprehensive coverage because it does not involve a
collision with another vehicle.
Coverage in the event of a fire is also included with your comprehensive
coverage. It will cover any damage or loss due to fire. The car
insurance company will honor your claim as long as there was an actual
fire that damaged the electrical components of your car.
Accidents with Animals
Animals can be unpredictable, and we understand that. An accident
involving an animal is never easy, but we want you to have peace of mind
when it comes to whether your vehicle is covered or not. Accidents
involving animals are usually covered by your comprehensive coverage.
This can vary depending on the type of animal you hit because if
the animal has an owner, the owner is typically held responsible for the
Filing a Claim for These Policies
Filing a claim, regardless of the coverage chosen, typically has the
same procedure. Begin by reading through your auto insurance policy and
talking to your agent about any uncertainties. Understand what it
covered by your policy - roadside assistance, free towing, injuries,
third-party liability, and your own vehicle’s damage. Make sure
that you have a copy of your insurance in your vehicle at all times.
If you have been involved in an accident, the first thing you need to
remember is to stay calm. Check to see if you and your passengers are
okay and call for medical assistance if needed. Make sure that your
surroundings are safe before touching or moving anything out of the vehicle. You may also want to put up your
early warning device (reflective triangles) and turn on your hazard
lights to inform other drivers that there has been an accident.
When you know that everyone is okay, you need to document the scene.
Take photos that show damage to your vehicle, the license plate, and its
relation to the road. If another car is involved in the accident you
should take pictures of that vehicle as well. Never settle with cash and
get all of the necessary information from the other driver. You should
note the name, contact number, address, license plate, and
driver’s license number for any drivers involved in the accident.
Call the police immediately so the incident is reported, and your
insurance company is able to obtain a copy of the police report for your
claim. If you are unable to move your vehicle as a result of the
accident, you may contact your
provider or a towing service to move your vehicle.
Once you have collected the necessary information you should contact
your car insurance company to file your claim. When filing your claim,
you should be sure to include all of the involved parties’
information as well as any proof of injury or damage. From there, your
insurance company can provide you with a list of required documents and
you should be sure to submit everything they need as quickly as possible
to avoid any delays with your claim. The vehicle repair process varies
from company to company so you should check with your adjuster to
confirm whether you can take your vehicle to the body shop of your
choice or if they have a list of preferred body shops from which you can
choose. If you have any questions throughout the process, you should
contact your adjuster for clarification. Make sure that you and your
insurance company are both aware of when the repairs to your vehicle are
Will My Premium Go Up for Filing a Claim?
In the event of property damage to your vehicle, your premium may or may
not go up – it all depends on the circumstances. For instance, if
you file a claim for storm damage to your vehicle using your
comprehensive auto insurance coverage, you may notice an increase in
premium. The two main factors of this increase are your
auto insurance company and the type of claim. In some cases, your
history with your company and your age may contribute to this as well.
Every state has a different set of rules that apply to auto insurance and filing a claim so it may
be helpful to look into the specifics in your state. Remember that every
claim is different, and the details of your claim will determine if your
insurance premium will go up and by how much.
No matter how hard you try to avoid it, an accident or unwanted incident
can happen at any time. Having an auto insurance policy can help, but
don’t just take one out without understanding your coverage.
Always be informed of what you need to do and what your car insurance
covers, so if something happens, you are ready to file a claim.
Visit our website to
learn more about the different types of insurance we offer and get a
free online quote or find the information for your
local Acceptance Insurance agent.
right type of coverage to make sure you are protected in any situation
can be confusing. Your local Acceptance agent can help you determine the
best coverage for you!